Thinking about self-managed super (SMSF)

Published by Australian Taxation Office

So you’re thinking about starting your own self managed super fund. That’s great – but are you aware of what’s really involved?

If you set up a self-managed super fund (SMSF), you're in charge – you make the investment decisions for the fund and you're held responsible for complying with the super and tax laws. It's a major financial decision and you need to have the time and skills to do it.

Let’s take a quick look at a typical self-managed super fund.

When you first set up you need to:

• Decide on fund members and trustees;

• Establish the trust and trust deed;

• Set up a bank account,

• Register with the ATO,

• create your Investment strategy,

• and include a plan for when your SMSF ends

There’s more to consider once set up including

• Rolling over of existing super;

• Organising employer contributions;

• Accepting contributions within limits

• Making investments without breaking rules;

• Regularly reviewing the investment strategy; and

• Documenting and maintaining records for up to 10 years.

Then, each year you need to

• Value assets;

• Prepare accounts & financial statements,

• Appoint a registered Self Managed Super Fund auditor;

• Lodge the annual return,

• Pay the Self Managed Super Fund levy; and

• Any tax that’s due.

When you start making payments, you need to

• Decide if any assets need to be sold;

• Ensure minimum payments are met each year;

and you may also need to

• Appoint an actuary;

• Withhold tax; and

• Give payment summaries to members as well as the ATO.

Finally, when the fund is finished you need to

• Get a final audit; and

• lodge your final return;

plus you’ll also need to

• Pay any outstanding tax; and

• Payout or rollover all of the assets.

As you can see, there is a lot involved. Before you decide to start a self managed super fund you need to consider whether you can manage everything or whether you need professionals to help.

We are a team of MFAA Approved finance brokers with the knowledge and experience to help you iron out the details. Contact us for more information.

An MFAA Approved finance broker is much more than your average finance broker.